Wal-Mart aims to source $400 million of local produce by the end of 2008.

In early July Wal-Mart released a statement emphasizing its local purchasing practices and outlining its intention to increase purchases of local produce to total $400 million by the end of 2008. Local producers voiced support for the initiative and the store's sales and stock price rose, but corporate watchdog Wal-Mart Watch released a statement two weeks later highlighting the retailer's poor performance in two recent public opinion polls, which it attributed to widely publicized mistreatment of workers at various U.S. Wal-Mart stores and the sometimes negative impact of Wal-Mart (NYSE: WMT) stores on local communities.

While analysts point to an increase in shoppers at Wal-Mart thanks to the U.S. recession and high food prices, the polls, conducted by Harris Interactive and The Reputation Institute, indicate that it's more an issue of economics than choice. The Harris Interactive Poll found that shoppers consider labor practices above other corporate social responsibility issues, leading many to view Wal-Martin a negative light. The other, conducted by The Reputation Institute, annually gauges consumer perceptions and overall trust and admiration of the country's largest companies. The 2008 survey ranked Wal-Mart 136 out of 150 companies, a 76 point fall from its 2007 ranking.

While the surveys pointed to Wal-Mart's reputation for negatively impacting local communities, the retailer's local food announcement claimed to have increased its partnerships with local food producers by 50 percent over the last two years, which would seem to have a positive impact on local economies.

Van Groningen & Sons, a watermelon, corn and pumpkin grower based in California's San Joaquin Valley, is one of the largest suppliers of California watermelons to Wal-Mart. Danielle Cultrera, who manages the farm's Wal-Mart account, recently told Fresh Plaza that, in addition to increased sales, its partnership with Wal-Mart was a great opportunity to get the farms name out to local consumers. Buying local is also economically beneficial for Wal-Mart, according to spokeswoman Diesha Galberth, who said buying local saves the company 100,000 gallons of diesel fuel a year and eliminates 672,000 food miles -- which adds up to $1.4 million in annual savings.

Evidence of the Bentonville-based retailer's increased commitment is already evident in West Coast stores, with California Wal-Mart locations promoting California-grown watermelons, while Washington state stores have installed locally-grown cherry displays. Still, while local producers throughout the West Coast have voiced excitement about the announcement, some are concerned that as purchases of their produce increase locally, they could decline in other parts of the country as other retailers join Wal-Mart in the quest to increase local purchases.